2021 Lifetime Learning Credit
For 2021, the Lifetime Learning Credit is $2,000 (Maximum credit), 20% (Rate on qualified expenses) and $10,000 (Qualified expenses limit).
Effective 2021-01-01Source: Publication 970 (2021), Tax Benefits for Education (IRS)Verified 2026-08-29
Compared with 2020
Every figure on this page is unchanged from 2020.
| Item | 2020 | 2021 | Change |
|---|---|---|---|
| Maximum credit | $2,000 | $2,000 | +$0 (+0.0%) |
| Rate on qualified expenses | 20% | 20% | +0% (+0.0%) |
| Qualified expenses limit | $10,000 | $10,000 | +$0 (+0.0%) |
Who it applies to
Taxpayers who paid qualified education expenses in 2021 for themselves, their spouse, or a dependent claimed on their return, and who meet the income and other eligibility requirements.
What changed this year, and why
The Lifetime Learning Credit for 2021 allows a nonrefundable credit of up to $2,000 per tax return. The credit is 20% of qualified education expenses, with qualifying expenses limited to $10,000 per return.
Common questions
- What is the maximum Lifetime Learning Credit for 2021?
- The maximum Lifetime Learning Credit is $2,000 per tax return. The credit equals 20% of qualified education expenses, and expenses count up to a limit of $10,000 per return.
- Did the credit amount change from 2020 to 2021?
- No. The 2020 Lifetime Learning Credit also had a maximum of $2,000, a 20% rate, and a $10,000 qualified expenses limit.
The cap is per tax return, not per student
The Lifetime Learning Credit caps at $2,000 per tax return, regardless of how many students you paid expenses for. This is different from some other education benefits that apply per student. If you have multiple eligible students in your household, you still cannot claim more than $2,000 total on your return. The credit equals 20% of qualified education expenses, up to $10,000 of expenses per return, so the math works out to the same $2,000 ceiling whether you have one student or several. You cannot multiply the credit by the number of students you support.
Maximum credit Up to $2,000 credit per return
Publication 970 (2021), Tax Benefits for Education (IRS)
It can wipe out your tax but never pays you back
The lifetime learning credit is nonrefundable, meaning it can reduce your income tax liability to zero but cannot generate a refund on its own. If you owe tax and the credit exceeds what you owe, the excess is simply lost - you do not receive the difference as a refund payment. The credit equals 20% of qualified education expenses, capped at $10,000 of expenses, which produces the maximum credit of $2,000. This ceiling applies regardless of how many students you claim or how much you actually paid in tuition. Taxpayers with little or no tax liability in a given year may not benefit fully from the credit, but they remain eligible to claim it again in future years when their tax situation differs.
The lifetime learning credit is a nonrefunda- ble credit. This means that it can reduce your tax to zero, but if the credit is more than your tax, the excess won't be refunded to you.
Publication 970 (2021), Tax Benefits for Education (IRS)
There is no cap on how many years you claim it
Unlike some education tax benefits that are limited to the first few years of postsecondary study, the lifetime learning credit can be claimed for an unlimited number of tax years. There is no cap on how many years you may claim it for any given eligible student. Whether the student is in their first year of college or taking courses decades later, the credit remains available each year they enroll in qualifying classes. The maximum credit per return is $2,000, calculated as 20% of up to $10,000 in qualified education expenses. As long as the taxpayer meets the eligibility requirements - including the income thresholds - the credit can be used year after year without expiration.
There is no limit on the num- ber of years the lifetime learning credit can be claimed for each student.
Publication 970 (2021), Tax Benefits for Education (IRS)
A single course to improve job skills qualifies
You do not need to be enrolled in a degree program to claim the lifetime learning credit. The credit is available for courses taken to acquire or improve job skills, even if the student is not pursuing a credential. A single class at an eligible educational institution can qualify. Courses involving sports, games, hobbies, or noncredit instruction generally do not count, unless they are part of a degree program or are taken to acquire or improve job skills. The maximum credit is $2,000 per return, calculated as 20% of qualified expenses up to $10,000. There is no limit on the number of years you may claim the credit, so you can use it repeatedly for job-related courses throughout your career.
However, if the course of instruction or other education is part of the student's degree program or is taken by the student to acquire or improve job skills, these expenses can qualify.
Publication 970 (2021), Tax Benefits for Education (IRS)
One student, one credit, one year
For each student in each tax year, you may claim only one education credit - either the American opportunity credit or the lifetime learning credit, never both for the same student. If you have multiple students, you could claim different credits for different students, but for any single student in a given year, you must choose. The IRS notes that when you have the choice, the American opportunity credit will always produce a larger benefit than the lifetime learning credit, so it is generally the better option for eligible students in their first four years of postsecondary education.
If you are eligible to claim the lifetime learning credit and you are also eligible to claim the American opportu- nity credit for the same student in the same year, you can choose to claim either credit, but not both.
Publication 970 (2021), Tax Benefits for Education (IRS)
The income at which you lose the credit entirely
The lifetime learning credit phases out completely once your modified adjusted gross income reaches certain thresholds. For 2021, you cannot claim the credit at all if your MAGI is $90,000 or more when filing as single, head of household, or qualifying widow(er), or $180,000 or more if filing married filing jointly. The credit begins to phase out before reaching these upper limits, so taxpayers with income just below the cutoff may receive a reduced credit. There is no partial credit available once you reach or exceed these amounts. The credit itself is 20% of qualified expenses up to $10,000, which produces the maximum benefit of $2,000 for those who qualify.
Your modified adjusted gross income (MAGI) is $90,000 or more ($180,000 or more if filing married fil- ing jointly).
Publication 970 (2021), Tax Benefits for Education (IRS)
How each figure was verified
Each number below was read from a stored copy of the document named beside it, and checked to occur word for word in the quoted sentence. The digest is of that stored text.
Publication 970 (2021), Tax Benefits for Education (IRS)
- Maximum credit
Maximum credit Up to $2,000 credit per return
- Rate on qualified expenses
The amount of the lifetime learning credit is 20% of the first $10,000 of qualified education expenses you paid for all eligible students.
- Qualified expenses limit
The amount of the lifetime learning credit is 20% of the first $10,000 of qualified education expenses you paid for all eligible students.